In the face of a confidence crisis on stablecoins’ integrity, developers of Helio say they have devised a protocol that can safeguard investors’ funds.
Helio Token Overcollateralized by BNB
The collapse of Terra Luna and Terra USD ecosystem this year greatly impacted the confidence in non-collateralized, algorithmic stablecoins among investors. One team that is having a go at creating a better stablecoin is the Helio Protocol on BNB Chain.
Helio (HAY) is an upcoming stablecoin pegged to the U.S. dollar where users deposit BNB as collateral to mint the “decentralized stablecoin” (or “destablecoin”) HAY and receive yields.
In a recent interview with BSC News, the Helio team explains that the collateralization ratio for the protocol is 133%.
“If you provide $1,000 worth of BNB collateral, then you can borrow up to $666 worth of HAY,” Elliscope, lead product manager of Helio, told BSC News.
Of course, given the high level of collateralization, holders must be incentivized to deposit their BNB and mint HAY. To address this, the Helio team employs liquid staking, or delegating users’ tokens on their behalf without them losing access to their funds, to generate yields averaging 7% per year.
“Basically, staking rewards we get from the BNB collateral are automatically distributed to HAY stakers for providing the liquidity,” said Helio’s community manager, who wished to remain anonymous. Regarding security, the team says they have witnessed the recent turmoil in crypto markets and designed security measures for the protocol in advance.
“Right now, we have about five smart contract audits. And after that, we have an emergency shutdown mechanism,” Elliscope said. “If an attacker does find an exploit, we can flip the switch and shut down the entire protocol immediately.”
In addition, the team is placing a hard limit on the minting of new HAY, and will slowly adjust the gap as more funds flow while keeping an eye on any abnormalities.
In terms of next year’s roadmap, the Helio team plans to integrate with as many DeFi protocols on BNB Chain as possible. Then, they plan to have a generation event for the Helio governance token. Finally, Helio intends to expand its staff count and ensure that more participants can contribute to the implementation level.
Currently, the Helio community has about 9,200 Telegram members and 5,500 Discord users. Moving forward, the team plans to make Helio fully community-driven. Elliscope explain that, regarding their governance token, more than half will be allocated to staking rewards, and about 1% for the team.
“We really want this project to be owned by the community instead of us developers having a centralized voice in everything,” Elliscope said.
Thus far, the protocol has surpassed over $40 million in Total Value Locked.
Source : bsc.news
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